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Friday, February 23, 2024

Homeowners in vulnerable communities could lose their homes due to misinformation

Homeowners in vulnerable communities could lose their homes due to misinformation
Families in California's most vulnerable communities face the threat of losing their homes, risking foreclosure, when pandemic-era mortgage relief runs out before they even know it exists.

Families in California's most vulnerable communities face the threat of losing their homes due to lack of a will or unclear debts, putting them at risk. to foreclosure, when pandemic-era mortgage relief runs out before you even know it exists.

Joe Jaramillo, senior attorney at HERA, a statewide nonprofit organization dedicated to housing legal services and advocacy, says the biggest threat homeowners face is keeping their homes when a parent or father dies. grandfather and end the mortgages that lurk with unexpected bills and threats of foreclosure.

During an information session held by Ethnic Media Services, the lawyer specified that if the owner of the home dies, this is put at risk by not having a will, so the family members have to go through an arduous and long legal process to inherit it while property taxes, insurance and mortgages pile up with unclear responsibility for who should pay.

Lawyer Jaramillo said Black and Latino households consistently report higher risks of foreclosure because of this problem.

On the other hand, Property Assessed Clean Energy (PACE), which allows you to finance clean energy home improvements such as the use of solar energy, grants loans that require no initial outlay, are collected by adding large sums to property taxes. property. It seems like a good opportunity, but this has put thousands of Black California homeowners at risk of foreclosure.

"It sounds good in theory," Jaramillo said, "but many sellers and contractors target low-income households and misrepresent costs or install upgrades that don't work or aren't connected, like solar panels."

A third factor, he continued, are zombie mortgages: "second loans often taken out at the same time as a larger first lien mortgage, split to allow borrowers to avoid large down payments and apply part of the second to the down payment," concluded Joe Jaramillo.

In California, with the Mortgage Relief Program, homeowners have been able to overcome these threats, said Rebecca Franklin, president of the California Housing Finance Agency (CalHFA).

Since it was launched at the federal level in December 2021, more than 23,000 Californians have kept their homes thanks to the program that offers subsidies of up to $80,000 per home for a total of almost $650 million distributed so far.

However, with the one-time fund projected to be depleted in 2025 or likely sooner, he urged homeowners to take advantage of this opportunity and not let it pass them by.

Unlike the Great Recession aid programs, this "is a grant that does not have to be repaid," Franklin explained. "Often when homeowners hear about our program, they don't believe it."

?Getting 80 thousand dollars that does not have to be returned is too good to be true, this is not real, that's what they believe. But is it real? He added, while recalling that homeowners can contact CalHFA to request housing advisors or legal services that fit their needs.

Johanna Torres, program coordinator for California Rural Legal Services, explained that even when assistance such as a mortgage subsidy or some others are available, many mortgage services do not inform homeowners, leaving many vulnerable to a completely unknown outstanding debt. .

Although laws such as the Real Estate Settlement Procedures Act exist and require most mortgage companies to provide periodic statements to the buyer, this becomes a problem as lenders are abusive by not provide the correct information, added Jaramillo when talking about the problems that owners face.  

HERA attorney Mary Day said that as foreclosure rates return to pre-pandemic levels, grants like California Mortgage Relief are critical to protecting families from losing their homes, which has It took years to pay and obtain, leaving families homeless and vulnerable. 

His client, Danny Bishop, shared his own experience of saving his Richmond home from foreclosure caused by bureaucratic confusion and deteriorating family health, something many citizens face.

"They never told me why they charged me so much," Bishop says. ?They told me to keep cleaning the backyard, that I was doing a ?good job?, and one day they charged me tens of thousands.?

Attorney Mary Day stated that although the tax code gives them the discretion to grant relief, after six months, many do not do so, and this is how many families are forced to face foreclosure with bureaucracy being the which makes things more difficult.  

You may be interested in: Our shared future: the initiative that seeks to heal communities


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